I for example don't think it's a technical feature.
> Compare and contrast with Tornado Cash, which still works fine despite being OFAC sanctioned.
This is why it might just be the thing that ends unrestricted access to Internet. P2P sharing music or torrenting movies caused a lot of noise but in the end violating copyright is not a big concern compared to laundering proceeds from criminal activities.
What cryptocurrency is? The answer is none, because there are several weak points to any cryptocurrency and if state agencies choose to take them seriously they can easily shut them down.
No, we don't. The thing is, every time a "good application of crypto" comes up the next question is "show these to us". And invariably those "good applications" have no idea what they are doing, require centralized trusted entities to function, and can be run from a Raspberry Pi.
But for the vast majority of businesses which interact with the real world, it doesn't matter whether the actual logic is on a bulletproof, uncensorable VM if the government can just go after the few input/output points where the system interacts with the real world.
Therefore, it's no better than just running SQLite and much worse because crypto makes significant tradeoffs (to be resistant to adversary interference) that aren't actually useful here.
Now, you may not care for law evasion, and that’s fine. But it’s asinine to pretend that crypto tech is not better for such purposes than “an SQLite database running on a raspberry pi.”